Update on Short Selling Restrictions

Update on Short Selling Restrictions

As a result of market disruption caused by the COVID-19 pandemic, the regulatory authorities of certain countries in Europe and Asia issued short selling restrictions. The European restrictions have expired, but the Asian restrictions are still in place. Below, we summarize the situation as at June 30, 2020.

Europe

The following countries in Europe imposed short selling restrictions from March 18, 2020 to May 18, 2020: 

  • Austrian Financial Market Authority (FMA)
  • Belgian Financial Services and Markets Authority (FMSA)
  • French Financial Markets Authority (AMF)
  • Greek Hellenic Capital Market Commission (HCMC)
  • Italian National Commission for Companies and the Stock Exchange (CONSOB)
  • Spanish National Securities Markets Commission (CNMV)

Asia

The following countries in Asia imposed short selling restrictions, which are still in place and are summarized in the table below:

  • South Korean Financial Services Commission (FSC)
  • Indonesian Stock Exchange (IDX)
  • Thailand Stock Exchange (SET)

Country

SSR

Dates

Comments

Indonesia
(IDX: Indonesia
Stock Exchange)

March 2, 2020
Ban on short selling transactions

March 2, 2020 until further notice

The IDX’s decision can be found here.

South Korea
(FSC)

March 16, 2020
Ban on stock short selling in KOSPI, KOSDAQ and KONEX for six months

March 16, – September 15, 2020

The FSC’s decision can be found here.

Thailand 
(SET: Stock Exchange of Thailand)

March 13, 2020
Tightened short selling to trade only the price higher than the last trading
price (uptick) effective since the afternoon trading session of March 13, 2020

March 13 – June 30, 2020

The SET’s decision can be found here.

Thailand 
(SET: Stock Exchange of Thailand)

Thailand 
(SET: Stock Exchange of Thailand) March 18, 2020
Further tightening measures by adjusting the circuit breaker (temporarily halt
in trading) rule, effective from March 18, 2020 and would last no longer than
June 30, 2020. March 18, – June, 30 2020

March 18, – June, 30 2020

 

 

Thailand
(SET: Stock Exchange of Thailand)

June 25, 2000
Extension of the circuit breaker rule from June 30, 2020 to September 30, 2020

June 30 –
September 30 2020

The SET’s decision can be found here.

 
Short Position Notification

On March 16, 2020 the European Securities and Markets Authority (ESMA) temporarily amended the threshold for notifying net short positions to Competent Authorities under the Short Selling Regulation from 0.2% of issued share capital to 0.1%. This measure was originally in force until June 16, and was renewed from June 17, 2020 for a further three months until September 17, 2020. Read the FCA announcement  here.

Duff & Phelps has wide experience in short selling and have worked with a number of firms to assist and advise on this area. If you need any help in relation to short selling or have any questions on the above, please feel free to contact us.

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